This dispute concerns a 20-foot strip of land directly north of property
leased by plaintiff Aero Sales, Inc. from defendant City of Salem (1) that plaintiff
wishes to use to give aircraft from its hangar access to the north taxiway at Salem's
McNary Field. Plaintiff appeals from a judgment, following trial, in which the trial court
rejected plaintiff's alternative claims for (1) reformation of a lease agreement with
defendant, (2) breach of the agreement as reformed, and (3) imposition of a constructive
trust against Carpenter Commercial Properties, LLC (Carpenter), to which defendant has
leased the disputed property, to require Carpenter to provide plaintiff access over that
property to the north taxiway. We reject without discussion plaintiff's argument
concerning its claims for breach of contract and imposition of a constructive trust. We
write to address only plaintiff's arguments concerning its alleged entitlement to
reformation of the lease agreement with defendant. For the following reasons, we affirm.

A party seeking reformation of a contract has the burden to establish the
following elements by clear and convincing evidence:

"(1) that there was an antecedent agreement to which the contract can be
reformed; (2) that there was a mutual mistake or a unilateral mistake on the
part of the party seeking reformation and inequitable conduct on the part of
the other party; and (3) that the party seeking reformation was not guilty of
gross negligence."

Jensen v. Miller, 280 Or 225, 228-29, 570 P2d 375 (1977) (citations omitted). Plaintiff
asserts on appeal that it presented clear and convincing evidence of each of those
elements and that the trial court erred in holding otherwise. Our review is de novo, but, to
the extent that the trial court's factual findings were based on the credibility of witnesses,
we give "substantial weight" to those findings. Pioneer Resources, LLC v. D. R. Johnson
Lumber Co., 187 Or App 341, 343, 68 P3d 233, rev den, 336 Or 16 (2003).

Consistently with that standard of review, we find the facts as follows: In
1997, defendant planned to construct a new taxiway--the north taxiway--at Salem's
McNary Field, using federal and local funding sources. At that time, another taxiway, the
south taxiway, already existed.

On April 24, 1998, one of plaintiff's principals, McCracken, wrote to
defendant's urban development administrator, Hayden, expressing a desire to lease a
specific area

"suitable to construct an 80' x 120' corporate aircraft hangar. Those
dimensions may be altered slightly in conjunction with the proposed new
taxi-way construction. The hangar will have doors at both ends for the ease
of aircraft movement."

An attached diagram showed the proposed structure and indicated markings to both the
north and the south of the proposed structure representing taxiways. The existing south
taxiway abutted the property that McCracken indicated an interest in leasing, but, at that
time, defendant had not determined exactly where the projected north taxiway would be
located.

In July 1998, one of plaintiff's representatives, Kasper, again wrote to
Hayden:

"The purpose of this letter is to address the location of the proposed taxi-way. Our needs and the needs of the corporate hangar area in general
would be best met by the offset taxi-way option. This creates an area
suitable for the construction of medium sized corporate hangars on the
south side of the proposed taxi-way and allows for a future need for large
corporate or, perhaps, commercial size hangars on the north. The centered
taxi-way diminishes the usefulness of the south side and eliminates the
possibility of large corporate or commercial on the north side. We would
like to begin the permit and construction process in the near future, but the
location of the taxi-way affects the functionality of our proposed design.
While I know that the final decision on the location of the taxi-way may not
come for many months, a recommendation from the Airport Commission,
which has a large influence on the decision in this matter, would be enough
for us to proceed with our construction."

The next day, July 8, McCracken wrote again to Hayden, stating:

"Aero Sales proposes to construct a 125' x 90' hangar with a 65' x 20'
door at each end. The hangar will access the present taxi-way on the south
side and the proposed taxi-way on the north side. * * * The amount of
ground leased would encompass the hangar with a 5' buffer around the
hangar and a 35' x 90' ramp area on the south side. We would like to begin
the lease and ground rent on the 35' x 90' north side ramp area upon
completion of the proposed taxi-way expansion. The included drawings
indicate the areas that we propose to lease and their relation to surrounding
buildings."

(Emphasis added.) Hayden indicated to McCracken that it would not be possible to defer
the lease of the 35-foot by 90-foot ramp area on the north side until the completion of
construction of the north taxiway. Plaintiff's proposal to lease the property ultimately
included the lease of the 35-foot area to the north of the hangar.

The lease into which the parties entered was defendant's standard form
lease. The agreement provided that plaintiff would "use the said premises for the
construction, maintenance, use and occupancy of an aircraft storage hangar[.]" The
agreement incorporated by reference an attached map that showed the exact size and
location of the parcel being leased. The map shows the hangar situated in the parcel, with
five feet of open space on the east and west sides of the hangar, and 35 feet of open space
on the north and south sides for aircraft access to the hangar doors.

The lease agreement contains no reference to the location of any taxiway in
relation to the leased parcel. Specifically, we note that there is no evidence that plaintiff
and defendant's representatives negotiated any terms by which plaintiff would lease
additional property to the north of the proposed hangar to be used for access to the north
taxiway. Plaintiff's only evidence concerning this point was testimony by McCracken that
Hayden had said, in the course of discussing access to the proposed north taxiway, "If you
need more, then we'll add that to your lease later." Hayden, on the other hand, had no
recollection of such a conversation and testified that plaintiff had never asked for an
option to expand its lease to extend to the taxiway once it was constructed. Again, the
lease did not mention any access to taxiways.

Over the course of the next several months, plaintiff constructed its hangar.
At the north end of its hangar, plaintiff constructed a helicopter pad that extended some
10 feet beyond the area that it had leased. Plaintiff leased the hangar to the Oregon State
Police.

Meanwhile, in early August 1998, defendant was entertaining a proposal
from Carpenter, which wanted to construct a large jet center at McNary Field. Carpenter
indicated to defendant that the proposed north taxiway would need to be made of concrete
rather than asphalt and must be of a size large enough to accommodate certain types of
jets. As defendant's negotiations with Carpenter were ongoing, in early 1999, defendant
decided the exact location of the north taxiway, establishing that it would be located 20
feet north of the northernmost part of plaintiff's parcel. Carpenter proposed to lease all of
the property abutting the north taxiway, including the 20-foot strip to the north of
plaintiff's parcel. At an Airport Advisory Commission meeting, Carpenter's
representative, Ribera, told the commission that Carpenter did not plan on using the strip
of land between plaintiff's property and the north taxiway and that there would be "no
problem" with plaintiff's access to the north taxiway. From that statement, the
commissioners understood that Carpenter would permit plaintiff to use the strip to have
access to the north taxiway. The commission gave preliminary approval to the Carpenter
lease.

In 1999, defendant and Carpenter executed their lease. The agreement
between defendant and Carpenter ultimately provided for Carpenter to provide the funds
necessary to upgrade the planned north taxiway from asphalt to concrete and to make it
larger than originally planned. Several months later, Carpenter constructed a fence in the
area immediately north of plaintiff's property and removed the portion of the helicopter
pad that encroached on its property. Carpenter's actions limited the use of plaintiff's
tenant, the Oregon State Police, which had been using the north door of the hangar for
helicopter access. Plaintiff and Carpenter attempted to negotiate an agreement permitting
plaintiff and users of its hangar to have access to the north taxiway, but they were unable
to reach an agreement. This litigation ensued.

The gravamen of plaintiff's reformation claims is that defendant knew when
it leased the property to plaintiff that plaintiff intended to construct a hangar that would
have access to both the existing "south taxiway" and the proposed north taxiway--that is,
that both parties understood that guaranteed access to the north taxiway, wherever it was
ultimately situated, was an essential condition and feature of the lease. Thus, plaintiff
contends, regardless of whether the written lease explicitly recognizes such an entitlement
to access, that entitlement was a fundamental, albeit implicit, term of the parties'
agreement. Accordingly, in seeking reformation, plaintiff contends that the following
term was erroneously omitted from the lease agreement:

"When the location of the public taxiway to the north of Plaintiff's leasehold
is established, the City of Salem will either reserve access to the public
taxiway to Aero Sales, Inc., in the lease to any third party that may lease
land between Aero Sales leasehold and the public taxiway to the north of
that leasehold, or will lease to Lessee Aero Sales, Inc., additional land, if
any is required, to ensure Lessee's access to the public taxiway and upon the
same lease rate per square foot, terms and conditions, as are contained in
this Lease."

The trial court termed the "central issue" with respect to reformation as
follows:

"Notwithstanding the lack of any language in the lease agreement, is there
sufficient evidence to establish that there existed an antecedent agreement
between the City and the plaintiff to the effect that the plaintiff would be
allowed to lease such additional land as necessary to secure access for the
plaintiff to the north taxi-way from its hang[a]r once the exact location of
the north taxi-way was established?"

The court, after rendering extensive findings, concluded:

"The bottom line in this case is that plaintiff, through its authorized
representatives, who are experienced and knowledgeable businessmen,
executed a lease without the necessary language to protect their right of
access to the proposed north taxi-way and simply 'assumed' that they would
be given some 'first right' or 'option' on the property needed at some time in
the future. Plaintiff's representatives have no one but themselves to blame
for the situation they now find themselves in."

As an initial matter, we note that there is absolutely no evidence that the
parties ever discussed the possibility that the "City of Salem will * * * reserve access to
the public taxiway to Aero Sales, Inc., in the lease to any third party that may lease land
between Aero Sales leasehold and the public taxiway to the north of that leasehold," as
plaintiff's requested reformation proposes. See ___ Or App at ___ (slip op at 6-7). Much
less is there any evidence that the parties reached an agreement to that effect. Because
there is no evidence to support a determination that the parties had such an antecedent
agreement, the trial court did not err in denying reformation to incorporate such a term.

Nevertheless, as noted above, plaintiff's reformation claim is disjunctive
and alternative. Plaintiff also invokes an alleged antecedent agreement that defendant
promised to "lease to Lessee Aero Sales, Inc., additional land, if any is required, to ensure
Lessee's access to the public taxiway and upon the same lease rate per square foot, terms
and conditions, as are contained in this Lease." ___ Or App at ___ (slip op at 7).

On that point, plaintiff presented evidence that one of defendant's
representatives stated in the course of negotiating the lease, "If you need more [property
to provide access to the north taxiway], then we'll add that to your lease later." An
antecedent agreement need not, in itself, be binding in order to satisfy the test for
reformation. It need not, for example, satisfy the statute of frauds. See Pioneer
Resources, LLC, 187 Or App at 367. That is, the antecedent agreement itself need not
"'be complete and certain enough to be a contract.'" Id. at 367-68 (quoting Restatement
(Second) of Contracts § 155 comment a (1981)). Nevertheless, the antecedent agreement
must be sufficiently specific so that a contract can be reformed to accurately reflect the
missing term.

In this case, the fundamental difficulty with plaintiff's putative "we'll add
that to your lease later" "antecedent agreement" is that such an "agreement" lacks
sufficient specificity to be cognizable in reformation. While, given the context, it is
possible to infer from that statement that the object of the alleged "agreement" was a strip
of land of unknown dimensions that would connect plaintiff's hangar to the proposed
north taxiway in the event that that taxiway did not abut the hangar, it is impossible to
discern from that statement either whether (a) defendant intended to give plaintiff an
option to lease such a parcel without any additional consideration, or (b) defendant
intended to give plaintiff an option to lease such a parcel on the price terms that plaintiff
now suggests. Further, and even more importantly, we cannot infer from that statement
that defendant was agreeing to include any clause in the original lease concerning the
strip of land that might eventually connect the hangar to the proposed north taxiway.
Indeed, the statement that the land could be leased "later" suggests the opposite, viz., that
defendant did not intend to include such a term in the lease agreement and, instead,
intended to postpone any agreement about the land until a later date.

To support reformation, plaintiff must establish that the parties had an
antecedent agreement that was omitted from the contract, i.e., an agreement to include
something in that specific contract that was omitted. As we noted in Pioneer Resources,
LLC, reformation "'is available when the parties, having reached an agreement and
having then attempted to reduce it to writing, fail to express it correctly in the writing.'"
187 Or App at 370 (quoting Restatement at § 155 comment a (emphasis added)). Here,
plaintiff failed to demonstrate, by clear and convincing evidence, that it had an antecedent
agreement with defendant to include, in the lease that plaintiff now seeks to reform, a
term concerning the property that might be needed to connect plaintiff's hangar to the
proposed north taxiway. Rather, plaintiff's evidence indicates that, when plaintiff
broached the subject, defendant successfully put off reaching any agreement about land
that might eventually be needed to connect plaintiff's hangar to the north taxiway.

2. The commission itself is a body that reviews proposals and makes
recommendations; it does not enter into agreements to lease property. Rather, after approval by
the commission, the city attorney's office enters into negotiations and drafts lease agreements.
After the parties agree to terms, the lease is then submitted to the city council for decision.

3. The trial court also found that "the City was aware of plaintiff's desire to have
access to the proposed north taxi-way from its leased property prior to the execution of the lease
in September, 1998."

4. Given our analysis, we need not, and do not, determine whether plaintiff proved
the other requisites for reformation, i.e., that there was either a mutual mistake or a unilateral
mistake by plaintiff coupled with "inequitable conduct" by defendant and that plaintiff "was not
guilty of gross negligence." Jensen, 280 Or at 228-29.